PayPal
No Dispute Process for Service Merchants, $550 Lost

On February 14 I contracted with a consulting business to prepare a nonprofit application for a fee of $550 via PayPal, with an estimated completion time of two weeks. I paid in full. Two weeks elapsed without contact. I contacted the consultant to cease all work and refund my money. Instead, she sent incomplete applications with errors and other documents I did not request. The next day she left a voicemail that she would return the funds.

I contacted PayPal to inquire about the refund, and I was informed that no refund was in process. Later the consultant sent me a settlement email for half the amount. I filed a complaint with PayPal, and they informed me that the consultant was contacted.

March 9: Your dispute has been escalated to a claim - PP-001-693-622-692.

Later that day I received a second email from PayPal stating:

"We have concluded our investigation into your claim detailed below. We regret to inform you that we were unable to resolve this case in your favor because the claim was incomplete, filed incorrectly, or outside the bounds of coverage as defined in our User Agreement. As a result, we have not taken any action at this time. Please be assured that this case has been noted in the seller's record for future reference."

I contacted PayPal to ask why my claim was closed and was informed that PayPal does not handle disputes with merchants who offer services, only products. It is an automated system.

Buyers beware of this consultant. She took my money and sent me incomplete work filled with errors. The matter went on to other complaints, to the Grants Professional Association and the BBB of Chicago, which are posted as well.

The crux of the matter is that the consultant stated she did not do any work on my contract because she misunderstood what I wanted the first week, and the second week she was sick. Yet she refused to return my money because of information she found on the web. Bottom line, this consultant, a minister and professional grant writer, ripped me off, lied, and threatened me with legal action if I smeared her name. In addition, I contacted her list of references, and none of them vouched for her business.

As for PayPal, they should allow disputes for all transactions. PayPal needs to change its policy. I paid via PayPal assuming that if anything went wrong I would have recourse. Had I known that PayPal did not intervene in disputes involving merchants who offer services, I would have sought another consultant with a different payment method. I feel the consultant was aware of PayPal's dispute policy because she did not try to contact me when PayPal notified her.

It is now July, and my organization is out $550 for services not rendered. By not handling all claims, PayPal is giving service merchants an opportunity to keep money they did not earn. Yes, PayPal makes a notation in the merchant's file, but how many people have to lose money before PayPal closes their account?

The only thing PayPal offered me was a list of Internet agencies that investigate Internet crimes. Most of those agencies only gather information, and when they find a pattern of high complaints, they start an investigation. Since then I have been through a number of agencies, all with no results in reclaiming my money. Because of this situation, I will not use merchants that offer PayPal only. I hope that PayPal changes its policy so that consumers have some recourse if the merchant fails to deliver services.

Company: PayPal
Country: USA
Site: paypal.com

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